Three Ways to Eliminate Annual Employee Reviews

We may yet see the death of the employee annual review in our lifetime. And it’s been a long time coming. This year, several very large corporations have announced that they will no longer put their managers and employees through the year-end torture. The shift appears to be taking hold fairly well in tech and tech consulting firms, perhaps as a result of the influence of workforces that skew somewhat younger than in other industries.

Let’s look at how companies are making this major change in order to benefit all employees and the bottom line.

The shift will involve training for managers and learning/training executives in how to better “talk with” rather than “talk about” people. The increased feedback flowing back and forth, says Glint, Inc. CEO Jim Barnett, will require fast responses to keep employee engagement high. This is particularly of interest to millennials, according to many studies of their attitudes about what makes a good workplace.

At GE, where the dreaded forced ranking system got its start with CEO Jack Welch, management has decided that it is time for a change. That change, they say, might involve getting rid of performance ratings altogether. A pilot group is testing the method.

Meanwhile, more certain changes are planned that will harness the power of technology, according to the Washington Post. Managers and employees may start using apps to chart productivity and exchange frequent feedback, allowing more effective casual coaching. GE managers also cite time and money wasted on the annual review process, goals that are outdated and irrelevant by the time the end of the year arrives, and the possibility that technology could correct for human biases.

No matter the organizational goals, or the amount of time and money that could potentially be saved, acceptance that the annual review is a concept whose usefulness has expired appears to have taken root.

Kachina Shaw is managing editor for IT Business Edge and has been writing and editing about IT and the business for 15 years. She writes about IT careers, management, technology trends and managing risk. Follow Kachina on Twitter @Kachina and on Google+